Friday 4 July 2014

Libel indemnities on the agenda...and still unlawful - updated; Cllr Caiach writes to the Minister

Update 6th July; Cllr Sian Caiach has written urgently to Lesley Griffiths, Welsh Local Government minister, the full text can be found at the end of this post


Following the EGM on the 27th February council decided to ask for further guidance over their power to grant an indemnity to bring an action for libel on behalf of officers. Specifically of course was the issue of the public funding of the indemnity for Mr James to counter sue me.  The Appointed Auditor had deemed it unlawful, and still does.

According to Mr James' bizarre 'newsletter', as per yesterday's post, he claims that the council 'has subsequently confirmed with Welsh Government that the Council does have the powers to grant such indemnities'.

It does no such thing.

This matter is now on the agenda for next week's full council meeting.

The correspondence with Lesley Griffiths, the Welsh Minister, can be read here and it does not differ from earlier correspondence from former local government minister, Carl Sargeant. She states that she does not have all the facts and neither has she seen the reports which were given to members. On that basis, I'm not sure she was in a position to give any guidance anyway.

However, she refuses to give legal advice and states that 'the issue of Statutory interpretation is clearly a matter for the courts'. In other words, the Welsh Government is not in a position to clarify a matter of law such as this, only a court can decide.
She notes the risks associated with relying on the Local Government Act and consequently the 'exceptional circumstances' 'get out' clause.

As Carl Sargeant said in 2010, the council must satisfy itself and others that it has acted within the powers available.

So, as I said, Mark James is wrong and disingenuous, the Welsh Government has not confirmed that the council has such power.

Linda Rees Jones, the acting head of law, and the Director of Resources, Roger Jones have compiled a report, here, for next week's meeting. These two officials were the authors of the report (along with contributions from Mr James himself) to the Executive Board in January 2012 where the indemnity was granted. This was the meeting where Mr James not only remained present but also failed to declare a financial and personal interest.

Mrs Rees Jones, as the council solicitor has a decidedly vested interest in all this. If council had agreed that the indemnity was unlawful then this would have serious implications for her, and Mr James of course.

The fact remains though that it was unlawful.

In addition, the Appointed Auditor has seen the letter from Lesley Griffiths and, not surprisingly, has not changed his view that the indemnity was unlawful. Despite the 2006 Guidance, the 2006 Order itself specifically prohibits the granting of Indemnities to bring actions for libel. Simple.

What the council is relying on is that the 1972 Local Government Act allows for a council to “..have power to do anything (whether or not involving the expenditure, borrowing or lending of money or the acquisition or disposal of any property or rights) which is calculated to facilitate, or is conducive or incidental to, the discharge of any of their functions”.

The auditor is of the view that the 2006 Order removed once and for all the doubt within the Local Government Act specifically in relation to the funding of libel actions.

The council's opinion brings us back yet again to the issue of 'exceptional circumstances' and whether, by funding Mr James it facilitated the discharge of their functions. In plain English, was I clogging up the wheels of my local council to such a degree that it was in the public's best interest to fund Mr James' counterclaim.

Again I repeat, the Appointed Auditor does not recognise this argument at all, and neither, in my view, does the Welsh Government.

If we look at the council's 'exceptional circumstances' opinion in more detail, it is, as I have said before, deeply flawed. You may also remember that the legal advice (which has not been disclosed) on the merits of bringing the counterclaim was from Mr Adam Speker, the barrister who has represented Mr James throughout the case. Hardly an independent view.

The counterclaim was brought for entirely tactical reasons, and as part of the defence, if you will, not because Mr James felt suddenly concerned about what had been said. The blog posts concerned, (and you will recall part of the counterclaim concerned this very issue of the granting of indemnities which turned out to be unlawful anyway) were written several months prior to the counterclaim. Out of over 700 blogposts only two points were thought to be possibly actionable.

The bringing of the counterclaim also made any early resolution, and therefore a far smaller costs bill, extremely difficult. The action was a calculated step to put pressure on me to withdraw my claim, not because Mr James had suffered any injury to his reputation. For what it's worth, he acquired a CBE shortly before the counterclaim was brought; his reputation was intact.

The 'Derbyshire rule' prevents local authorities (and all government bodies) from bringing libel actions in their own name, this is to prevent any 'chilling effect' on robust democratic debate. Local authorities are also prohibited from using a council officer, in this case Mr James, to get around the Derbyshire rule by 'suing by proxy'.

Mr James confirms in his 'newsletter' that this is exactly what they have done - he bought the counterclaim 'on behalf of officers', clearly contrary to the Derbyshire rule.

Following the EGM, as we know, the indemnity was stopped and the 'clause' in the constitution suspended. It is not clear from the documents for next week's meeting whether the suspension will continue - if this is a matter for council to decide then I implore Member's to remove the clause once and for all. It is unlawful, unethical, and simply immoral.
What is clear is that senior officers are trying to mislead councillors into rejecting the Wales Audit Office report, I hope the Members don't fall for it.

In conclusion I remain of the view that the funding of the counterclaim was indeed unlawful and consequently I am also of the honest opinion that any Court Orders which have arisen from it are void. Mr James may not have brought the counterclaim had the public not been paying for it, I doubt very much if he'd have put his wallet and home on the line over it.

Without the counterclaim the outcome of the whole case may have been very different. Much of the council's defence revolved around my concerns and questions over the unlawfulness of such indemnities - apparently I was being unreasonable in questioning the 2008 clause in the constitution.

Turns out I wasn't.

Update 6th July;
Cllr Sian Caiach has written to the Welsh Local Government Minister Lesley Griffiths, it is self-explanatory;

Dear Minister,

At  our next full council meeting on the 9th July 2014 (Agenda item no 7 available on the Carmarthenshire County Website) we, all Carmarthenshire Councillors are being asked to approve a report by our Director of Resources and s151 officer, Roger Jones and acting Head of  Administration and Law and acting monitoring officer Linda Rees-Jones.

This report confirms the Council Executive's position that the libel indemnity found to be unlawful by the Wales Audit Office, is in fact, lawful. In accepting this report we, as a council, will be endorsing this position held by these officers, in conflict with the Wales Audit Office report that it was, in fact,  not lawful.

There appears to be no new evidence presented except your letter of 6th May 2014 to Dave Gilbert. which we have copied in our papers.

It is stated to us for guidance that " The minister's clarification of the Welsh Ministers' view of the Law has been received and is attached. The Welsh Government therefore reiterates its 2006 Guidance on that point.The advice given to the [County Council] Executive Board when it considered the grant of an indemnity to the Head of Paid Service (Mark James) in January 2012 was in accordance with that Guidance.

This opinion by these 2 officers who were themselves instrumental in giving the original guidance to the Executive Board in 2012 is that your letter supports them, and does not endorse the Wales Audit Office Report saying the payment was unlawful.

I myself do not agree with this interpretation, but as most of the Councillors do not have experience of reading legal reports they may not even try to wade through the rambling "explanation"  in their report of why these officers were right to promote the policy of supporting Mr James' in a libel claim against a blogger, and the reasons they regard your letter as agreement and confirmation that they were right to do so.

In 2012 we backbench Councillors were not given copy of the legal advice from James Goudie  [2008] which supposedly supported the decision to pay Mr James'  legal costs. When eventually given to us in the WAO report, it did no such thing.
We had been deliberately mislead.
Now the same officers who advised the executive in 2012 are asking us to approve a report which exonerates them on the basis of your letter.  I ask that you urgently make your true position known.

 A Labour led Council is otherwise very likely to vote to approve this report rubbishing the views of the Welsh Audit Office and therefore setting a precedent for Welsh Councils to take libel actions against bloggers and others using their officers as proxies, in the same way as Mr Mark James was used by the then Council Leader, Meryl Gravell to try to silence a critic.

Cllr Sian Caiach.
People First /Gwerin Gyntaf
Carmarthenshire County Council member for Hengoed Ward


Cneifiwr said...

Well said Jacqui.

Anonymous said...

Knowledge is power Jacqui and you have this in abundance!

Anonymous said...

Surely by arguing against waht is as clear as the nose on your face the solicitor for the county is in breach of her own proffesional rules. I know that she must serve the CE but she also has a duty to act in accordance with law Society standards.

Jocelyn said...

Jacqui, I am a reader of your blog and a long time fan, but I would like to make some observations on the legal case and this post you have published.

You've said in this blog that "Mr James may not have brought the counterclaim had the public not been paying for it".

I think you are probably correct. However I think the more pertinent point you appear to be overlooking is that Mark James would probably never have sued you at all had you not initiated a libel claim against him in the first place.

I get the sense that you feel there was a cunning ploy at play, that by counter-suing you Mr James and the council managed to get around the Derbyshire rule, this may be true, but again, linking in to my first point, you were suing him, you were on the attack which gave him the opportunity to counter-sue you. (Forget about the funding for a second). He didn't initiate legal action, you did, so it's not very convincing that this was a means to shut you up, you went on the offensive - and his reaction was also to go on the offensive, that's the risk with litigation.

I know you disagree with the judge's decision, but your claim was thrown out in its entirety. I tend to agree with you that on the evidence I have seen, the libel indemnity was unlawful, and therefore the funding of Mr James' counter-claim was unlawful, but you must surely accept that the source of funding for his counter-suit had no bearing whatsoever on the judge's decision.

You said in this blog: "Without the counterclaim the outcome of the whole case may have been very different."

That quote is very obviously correct - because without the counter-claim, you would have just lost your own claim and the net cost to you would have been limited to just the legal costs. Instead, the counter-claim went against you and you had to pay (in addition) the large damages, however I get the impression that you believe your original libel claim may have succeeded had Mr James not counter-sued, but I can see no real reason for that view.

I know you are bruised, but I think it would help to separate the source of the libel counter-claim funding and the court ruling into two different boxes.

You have beefs with both, but they should not be treated as one. Yes Mr James may not have sued you had he not been able to use the libel indemnity, but it was his response to your first move, and I can't think why there could be any suggestion that the source of the funds that were used to pay for his counter-claim had a bearing on the outcome of the case (which is different from his decision to counter-sue you.) To suggest otherwise (and I'm not saying you have, just the impression you give) would be illogical - because the source of funding was not a fact of your libel claim or Mr James' counter-claim, nor was it any part of either, so there is no reason the judge would have made a different decision with exactly the same facts.

Perhaps if we say, for instance, that Mr James funded the counter-claim without the council funding his indemnity. I think we can assume that whoever was paying his legal bill (himself, his mother, a wealthy cousin perhaps) the case would have centred on exactly the same facts, so I can see no reason why anybody could feel that the same judge would have made a different decision on the same facts.

By all means have a beef with the libel indemnity, campaign over it, I agree it's wrong, but don't relate it in terms of the court case you lost because it was not a fact of the case. You also happen to disagree with the judge's decision, but that is a completely separate 'beef' because, as I've said, there is no link between the funding of the counter-claim and the result!

Sorry it was a long post but I hope you approve it - I believe it would be good for you to separate the two, and focus your efforts on campaigning against the indemnity clause without criticising the decision, because there is no logical connection.

caebrwyn said...


Thank you for your thoughtful comment.

I presumed that everyone who is interested in this matter understands that I brought the claim in the first place. I did so as quickly as possible because the words I complained of were hurtful, untrue and highly defamatory, not just of me but my family as well and I felt that a legal response was the only option which had the strength to challenge the published words of a senior public official, in this case a chief executive of a council.
A prompt retraction and recognition that the words were defamatory were all I wanted.

I am not arguing either that Mr James did not have the right to countersue as a private individual in a private capacity, and as you rightly point out, this was simply a tactical move, not uncommon in litigation.
However, this has a bearing on the council's 'exceptional circumstances' argument and I stand by my view that in respect of the counterclaim, the circumstances were not exceptional in the defamatory sense, it was not a prompt reaction to recently published material.

The fact remains though that the funding was unlawful, he didn't pay for it himself, nor did a wealthy cousin and that is why I have mentioned the consequences of that in my post.

I also feel that the (publicly available) judgement from the last appeal hearing made it quite clear that the court were looking at meaning, not the unlawful funding of the counterclaim. It is common knowledge that any defamation case concerns matters of meaning.

It was interesting to note though that the appeal court recognised that the WAO findings were an important issue in law and remain unresolved.

In fact, Mr James himself was clearly concerned that the findings would have a bearing on the appeal and this was evident during his counsel's submissions at the hearing itself. It is worth noting that this concern translated itself into an additional submission to the court following the draft judgement which consisted of futher attempted justification for the unlawful funding.

I believe my plea that the counterclaim was an abuse of process should have stood and, as I said in my post, a considerable amount of evidence, and indeed part of the counterclaim revolved around my concerns about the libel indemnity clause itself.

Therefore, for you to say that this element had no bearing on the facts and the judge's decision, is wholly incorrect, you are also wrong to suggest that on a personal basis, there is no logical connection.

I am well aware that I lost the case in its entirety,(although Mr James did fail on two out of the five points of the counterclaim), this is public knowledge and there is nothing I can do about it. It is not a matter of feeling miffed, or having, as you put it 'a beef', or even the astonishing attitude of the trial judge; my disgust at the findings is based on the facts and evidence, or lack of evidence, which were before the court.

You cannot expect me not to consider that there may have been a different outcome with regards to both the claim and the counterclaim, but the unlawful funding was only one aspect which could have had a bearing on the outcome. Of enormous significance to me was the fact that, at the last minute, I was denied a jury - indeed a jury may have reached the same conclusions, but if that had been the case, I would have had at least a sense of fair play. For the record, I remain of the view that a jury would have reached very different conclusions.

The judge decided that the case, which was a six day trial, basically between two people, would be too complicated for a jury to consider. Contrast that with the jury at the recent phone hacking trial which lasted eight months, with mountains of documentation and a busload of lawyers. I am aware of the difference between civil and criminal trials but to have been found 'guilty' of criminal offences at a civil trial where the appropriate standard of proof was neither required, sought nor even found was simply outrageous.

(my comment continues....)

caebrwyn said...


(Continuing with my comment above....)

However, to return to your main point, the reason that the judgement has become conflated with the unlawful funding findings is that the council, and Mr James, have continually done so themselves.

They have attempted to justify, retrospectively, the unlawful funding by repeated reference to the outcome of the case. The libel indemnity issue is indeed separate, and of wider importance than the Thompson v James case.

The Appointed auditor himself said that he was not concerned with the outcome, nor the details of the case - the point at issue was twofold; the principle that the council had acted ultra vires and the decision taken on the 23rd January 2012 by the council's executive board based on a flawed and misleading report from the three senior officials involved.

If you wish to say that in regards to the continuing row over the unlawful payment, the two issues should be in 'separate boxes' and that the connection is illogical, I suggest you read Mr James' staff 'newsletter' issued only last week, and address your point to Mr James and the Council.

Thank you again for your comment,